The Bunker Hill Co.

THE BUNKER HILL CO. The Bunker Hill Company and Local Union 7854, United Steelworkers of America , AFL-CIO. Case 19-CA-6071 December 28, 1973 DECISION AND ORDER By CHAIRMAN MILLER AND MEMBERS FANNING AND JENKINS On August 31, 1973, Administrative Law Judge Irving Rogosin issued the attached Decision in this proceeding. Thereafter, the Respondent filed excep- tions and a supporting brief and the General Counsel filed a brief in opposition to the Respondent's exceptions. Pursuant to the provisions of Section 3(b) of the National Labor Relations Act, as amended, the National Labor Relations Board has delegated its authority in this proceeding to a three-member panel. The Board has considered the record and the attached Decision in light of the exceptions and briefs and has decided to affirm the rulings, findings, and conclusions 1 of the Administrative Law Judge and to adopt his recommended Order, as modified herein. ORDER Pursuant to Section 10(c) of the National Labor Relations Act, as amended, the National Labor Relations Board adopts as its Order the recommend- ed Order of the Administrative Law, Judge as modified below, and hereby orders that Respondent, The Bunker Hill Company, Kellogg, Idaho, its officers, agents, successors, and assigns, shall take the actions set forth in the said recommended Order, as so modified: 1. Delete paragraph 1(a) from the recommended Order and substitute the following: "(a) Unilaterally, and without prior notice to or consultation with the Union, promulgating or insti- tuting any incentive wage rules involving its employ- ees in the appropriate unit described herein." 2. Substitute the attached notice for the notice attached to the Decision of the Administrative Law Judge. I Chairman Miller concurs in the result but does not adopt all of the rationale of the Administrative Law Judge relating to the effect of the "zipper clause " He sees no need to reach that issue, since Respondent, by Its "Memorandum of Understanding," dated May 30, 1972, committed itself, in writing, to sit down with the Union to review and seriously consider any proposed changes or modifications of "Incentive Rules for Stripping." This, in the Chairman's view, was a clear recognition by the Company of an obligation to bargain about the subject matter here in issue , notwithstanding any existing zipper clause, and effectively estops the Company from raising the zipper clause as a defense to its subsequent unilateral action as to "Incentive Rules for Stripping " APPENDIX NOTICE To EMPLOYEES POSTED BY ORDER OF THE NATIONAL LABOR RELATIONS BOARD An Agency of the United States Government 27 WE WILL NO? unilaterally, and without notice to or consultation with Local Union 7854, United Steelworkers of America, AFL-CIO, promulgate or institute any incentive wage plan involving our employees represented for collective-bargaining purposes by that labor organization. WE WILL NOT in any like or related manner interfere with, restrain, or coerce our employees in the exercise of their right to self-organization, to form labor organizations, to join or assist Local Union 7854, United Steelworkers of America, AFL-CIO, or any other labor organization, to bargain collectively through representatives of their own choosing, to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection, or to refrain from any or all such activities, except to the extent that such right may be affected by an agreement requiring membership in a labor organization, as authorized in Section 8(a)(3) of the Act. WE WILL, upon request of Local Union 7854, United Steelworkers of America, AFL-CIO, formally rescind the "Incentive Rules for Strip- ping," dated August 23 and August 31, 1972, which we promulgated unilaterally. The appropriate bargaining unit is: All production and maintenance employees employed by the Bunker Hill Company at its operation in and around Kellogg, Idaho, excluding any craft units heretofore certified by the National Labor Relations Board (such as electricians, carpenters, bricklayers, boilermakers, and blacksmiths, plumbers, pipefitters, steam fitters and lead burners, and machinists), all supervisory, technical and clerical employees, gatemen, office clerical employees, guards and watchmen as certified by the National Labor Relations Board on August 12, 1970, Case 19- RC-5370. THE BUNKER HILL COMPANY (Employer) Dated By (Representative) (Title) 208 NLRB No. 17 28 DECISIONS OF NATIONAL LABOR RELATIONS BOARD This is an official notice and must not be defaced by anyone. This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. Any questions concerning this notice or compli- ance with its provisions may be directed to the Board's Office, 10th Floor, Republic Building, 1511 Third Avenue, Seattle, Washington 98101, Tele- phone 206-442-4532. DECISION STATEMENT OF THE CASE IRVING RoGosiN, Administrative Law Judge: The complaint, issued March 21, 1973, alleges that Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(1) and (5) and Section 2(6) and (7) of the Act,' Specifically, the complaint alleges that, on or about August 23, 1972, and August 31, 1972, Respondent, without prior notice to or consultation with the Union, the certified bargaining representative of Respondent's pro- duction and maintenance employees in the appropriate unit, unilaterally promulgated new incentive rules covering certain of its unit employees, and thereafter, on September 11, 1972,2 without prior notice to or consultation with the Union, unilaterally withdrew said incentive wage rules, thereby refusing to bargain with the Union as exclusive representative of the employees in an appropriate unit, and engaging in unfair labor practices within the meaning of Section 8(a)(5) of the Act, and interfering with, restraining, and coercing its employees in the exercise of rights guaranteed in Section 7 of the Act, in violation of Section 8(a)(1). Respondent's answer, dated March 29, 1973, admits the procedural and jurisdictional allegations of the complaint, including the status of the Union as exclusive representa- tive of the employees in the appropriate unit, but denies the substantive allegations of the complaint. As affirmative defense, Respondent alleges that (1) under the terms of the collective-bargaining agreement in effect between the parties, Respondent was justified in taking the unilateral action; (2) that the dispute between the Employer and the Union was subject to the grievance and arbitration procedure provided for in the contract, and (3) that the Employer had not been afforded a hearing within 5 days as required by the "rules of the National Labor Relations Board." 3 Hearing was held on June 26, 1973, at Coeur d' Alene, Idaho. The General Counsel and Respondent were represented by counsel; the Union was represented by the president of the local. All parties were afforded full opportunity to be heard, to examine and cross-examine 1 Designations herein are as follows: The General Counsel, unless otherwise noted or required by the context, his representative at the hearing, The Bunker Hill Company, Respondent, the Company or the Employer, Local Union 7854, United Steelworkers of America, AFL-CIO, the Charging Party or the Union; the National Labor Relations Act, as amended (61 stat , 136, 73 stat 519, 29 U S. Relations Act, as amended (61 Stat., 136, 73 Stat 519, 29 U S. C 151, et seq ), the Act, the National Labor Relations Board, the Board The charge was filed on October 2, 1972 witnesses, to introduce oral and documentary evidence relevant and material to the issues, to argue orally, and to file briefs and proposed findings of fact and conclusions of law. The parties waived oral argument, reserving their right to file briefs. Pursuant to an extension duly granted, briefs were filed by the General Counsel and Respondent, on August 6, 1973. No proposed findings of fact or conclu- sions of law have been filed by any of the parties. Upon the entire record in the case and, based upon the appearance and demeanor of the witnesses4 and the briefs, which have been carefully considered, I make the follow- ing: FINDINGS OF FACT 1. THE BUSINESS OF THE RESPONDENT The complaint alleges, Respondent's answer admits, and it is hereby found that The Bunker Hill Company, Respondent herein, is, and at all times material herein has been, a Delaware corporation, engaged at Kellogg, Idaho, and vicinity in the mining, smelting, and refining of nonferrous metals, and the manufacture of chemical fertilizers. During the 12 months preceding issuance of the complaint, a representative period of Respondent's annual operations, Respondent's volume of sales and services were valued in excess of $500,000. During the corresponding period, Respondent sold products, and purchased goods and materials, valued, in each instance, in excess of $50,000, outside the State of Idaho. On the basis of the foregoing, and upon the entire record, it is hereby found that, at all times material herein, Respondent has been an employer engaged in commerce and in operations affecting commerce within the meaning of Section 2(2), (6), and (7) of the Act. II. THE LABOR ORGANIZATION INVOLVED Local Union 7854, United Steelworkers of America, AFL-CIO, the Union herein, is, and at all times material herein has been, a labor organization within the meaning of Section 2(5) of the Act. III. THE UNFAIR LABOR PRACTICES A. Background The complaint alleges, Respondent's answer admits, and it is hereby found that, on or about August 12, 1970, following an election conducted by the Board, (Case 19-RC-5370), the Northwest Metal Workers Union, Independent, was duly certified by the Regional Director for Region 19 as the exclusive representative of Respon- dent's employees in the following appropriate unit, herein called the bargaining unit employees: Unless otherwise stated, all events occurred in 1972 2 The complaint inadvertently states the date as September 11, 1973. The correction was made at the hearing 3 Actually Sec 10(b) of the Act The answer erroneously alleges the period as 10 days but was amended at the hearing to conform to the language of the section 4 Respondent rested at the conclusion of the General Counsel 's case, without calling any witnesses THE BUNKER HILL CO. All production and maintenance employees employed by the Bunker Hill Company at its operation in and around Kellogg, Idaho, excluding any craft units heretofore certified by the National Labor Relations Board (such as electricians, carpenters, bricklayers, boilermakers and blacksmiths, plumbers, pipefitters, steam fitters and lead burners, and machinists), all supervisory, technical and clerical employees, gatemen, office clerical employees, guards and watchmen as defined in the Act. The complaint further alleges, Respondent's answer admits, and it is hereby found that, at all times material herein, the above-described unit was, and has been, an appropriate unit for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. The complaint also alleges, Respondent's answer admits, and it is hereby found that, on or about August 22, 1972, the Regional Director for Region 19, in Case 19-AC-10, issued a Decision and Order Amending Certification to reflect a change in name of the certified bargaining representative from Northwest Metal Workers Union, Independent, to Local Union 7854, United Steelworkers of America, AFL-CIO. The complaint further alleges, Respondent's answer admits, and it is hereby found that, on the basis of the Decision and Order, above-described, and the prior certification of the Independent, as above-described, the Union, at all times since August 22, 1972, has been, and is now, the duly certified exclusive collective-bargaining representative of all employees in the appropriate unit above-described for the purposes of collective bargaining with respect to the rates of pay, wages, hours of employment, and other conditions of employment, within the meaning of Section 9(a) and (c)(1) of the Act.5 B. The Alleged Refusal To Bargain 1. "Incentive Rules for Stripping" On August 23, 1972, Respondent posted on its bulletin board, and distributed to the employees involved, a notice entitled "Incentive Rules for Stripping." The "rules" established a voluntary incentive program for the electro- lytic department employees, known as "strippers."6 Under this program, performance of incentive work would entitle participants to a "reduction in the attendance time on the job below the normal eight hour shift." The preamble to the incentive rules, which stated that the purpose of the program was "to achieve a stable employment base by providing the employee with an opportunity to increase his earnings by performing work over and above an estab- lished base," announced that the incentive program was voluntary on the part of the employee, and that the program was being administered under specified rules set forth in the notice, and "subject to all the provisions of the 5 Upon a timely request for review of the Regional Director's initial Decision on the ground that he had erred in granting the amendment, the Board dismissed the petition filed by the Local Union 7854, the charging party herein The Bunker Hill Company (Case 19-AC-7),197 NLRB 334. At the request of all parties, official notice has been taken of those proceedings. Subsequently, the Regional Director, on or about August 22, 1972, issued his Decision and Order amending the certification to reflect the name of the 29 Labor-Management Agreement and other Company rules." Later that day some unit employees went to the union hall and brought copies of the notice to David M. Miller, president of the Union. Miller, in turn, furnished a copy of the notice to James P. Mooney, staff representative of the Union's parent organization (United Steelworkers of America, AFL-CIO), assigned to the Coeur d' Alene mining district in the Kellogg area, Idaho, to assist in administering the collective-bargaining agreement between Respondent and the Union. Mooney and the union committee had met with management, presumably Arthur P. Lennon, Respondent's director of labor relations, earlier that day, although the purpose of the meeting is not revealed by the record. Upon their return to the union hall, they found a number of zinc plant cell room workers or strippers awaiting them with copies of the incentive rules notice. It is undisputed that the incentive rules were promulgated and posted without prior notice to or consultation or negotiation with the Union. Shortly after 4 o'clock that afternoon, Mooney, with Miller on the extension, telephoned Lennon and requested a meeting to discuss the rules. Mooney stated to Lennon that the Company's action in promulgating or changing the incentive rules was contrary to his previous understanding with the Company, and that the men would not accept or work under those rules while there was a collective- bargaining agreement in existence. Lennon responded by asking Mooney how he knew that the men would not accept the rules since Mooney could hardly have had an opportunity to meet with all the men. Acknowledging that that was so, Mooney stated that enough of them had expressed dissatisfaction with the rules at the union hall to warrant his statement. Mooney proposed that the parties meet in an effort to negotiate a set of rules which would be acceptable to both parties. During this telephone conversa- tion, Miller interspersed comments of his own in a similar vein. Lennon declined to commit himself to such a meeting but said he would discuss it with management. Regarding the previous understanding with the Compa- ny, which Mooney mentioned in his telephone conversa- tion with Lennon, reference was to a memorandum of understanding, dated May 30, 1972, signed by Lennon, in his official capacity, William F. Boyd, counsel for the Company, David M. Miller, president of the local union, and James P. Mooney, staff representative of the parent labor organization. By the terms of this memorandum, the Company agreed to withdraw, with prejudice, an action for damages, filed in March 1971, against Northwest Metal Workers Union, and certain individual members, then pending in the Federal District Court, and resolved various grievances filed by the Union, on behalf of named employees. The memorandum further provided: 2. The Company has agreed to sit-down [sic ] with exclusive bargaining agent as Local Union 7854. (Case 19-AC-10) It is undisputed that the Union here has been the exclusive bargaining agent of the unit employees since August 22, 1972. 6 The job title applies to employees in the cell room of the electrolytic zinc plant who remove or strip the zinc sheets from aluminum plates on which the zinc has been deposited by electrolysis in cells utilized for the operation 30 DECISIONS OF NATIONAL LABOR RELATIONS BOARD the Union, as soon as mutually convenient, to review and seriously consider any proposed changes and/or modifications of the Rules on Absenteeism, Discipline, Work Rules, and Incentive Rules for Stepping. On August 25, 1972, the Union sent a letter by registered mail, return receipt requested, addressed to Lennon in his official capacity, signed by Miller and Mooney in their respective official capacities, as follows: This will confirm our telephone conversation on August 23, 1972, during which the Union requested a meeting for the purpose of reviewing proposed changes and/or modifications of the Incentive Rules for Strip- ping at the Zinc Plant Cell Room as provided for in the Memorandum of Understanding intered [sic] into by the Parties, dated May 30, 1972. As stated, we are prepared to meet at your earliest convenience. In fact, we are prepared to meet, and we propose that we do meet, during the week of August 28th, along with a Committee of involved employees. Any day next week is agreeable with us. Please advise as to what date and time is convenient for the Company. [Emphasis in original.] On August 28, 1972, Lennon replied, by letter addressed to Mooney, as staff representative of the Steelworkers, agreeing to "sit down with the Union" on Tuesday afternoon, August 29, 1972, in the staff house basement of the company premises, at 2 p.m. "to review and seriously consider any proposed changes and/or modifications of the Incentive Rules for Strapping in compliance with our Memorandum of Understanding of May 30, 1972." The letter continued, We understand that the Union referred to will be the recognized agents of the employees and will not be a group of employees having no official responsibility as officers of the Union, nor any admixture of these two groups. Your adding a "Committee of involved employees" as part of the Umon goes beyond the commitment we made in the Memorandum of Under- standing. Also, we reiterate that the Company has only agreed to review and seriously consider the Union's proposed changes and/or modifications of the Incentive Rules for Stripping, previously adopted and posted by the Company, and by such a meeting we have not made such Rules subject to negotiations nor is this meeting to be in any way construed as a negotiating session. If this is not your understanding, let me know. On August 29, the Union replied by letter to the Company, addressed to the attention of Lennon, and signed by both Mooney and Miller, submitting a copy of "proposed incentive rules for stripping, including a proposed rate to be paid for each additional load in excess of the eight (8) load per shift base." The letter further stated: This proposal has been prepared with the assistance of the strippers, the men who would be expected to do the work under any incentive program agreed upon. These proposed changes and/or modifications of the incentive rules are presented to the Company in accordance with the memorandum of understanding of May 30, 1972. ' We realize, of course, that in order to effectuate an agreement, there must be room for give and take by both parties. We would hope that the Company is prepared to give these proposals serious consideration. The Union is certainly prepared to do likewise to any counterproposals on the part of the Company. The preamble to the Union's proposed incentive rules reads as follows: When agreement is reached, rules to be reduced to writing in the form of a Memorandum of Agreement, any change in these rules will be through [sic] negotiations with the Union. Particition [sic] in the incentive program is voluntary on the part of the employees. The program is administered under the guidelines outline [sic] below.7 On August 29, Lennon met with the union representa- tives at the plant. In addition to Lennon, Richard Scott, his assistant, Department Superintendent Edgar W. Whitley, and R. L. Bird, manager of the zinc plant, attended for the Company; Mooney, Miller, and members of the executive board, on behalf of the Union. Miller distributed copies of the Union's counterproposals and covering letter to those present. Using his copy, Mooney reviewed the contents and explained the Union's position, stating that, based on the memorandum of understanding, dated May 30, the Union had prepared counterproposals with the assumption that concessions might be necessary on both sides in order to reach an agreement. Mooney then stated that since Miller was more familiar with the rules , Miller would review and comment on each of the rules . Some changes and insertions were made and initialed. Lennon then asked for a recess, and he and his group left. When they returned, Lennon said that the company representatives had some questions they wanted to ask. Lennon, Whitley, and Bird each asked questions dealing generally with the purport of particular language in the counterproposals. Lennon, in particular, questioned whether footnotes attached to the Union's proposals were to be considered an integral part of the rules. Both Mooney and Miller alternately responded, stating their interpretation of the various rules, and indicated that the footnotes were not to be regarded as part of the rules. At this juncture, Lennon stated that he wanted to make it perfectly clear that the meeting was not a negotiating session. Remarking that the Company appreciated the effort which had been entailed in preparing the counter- proposals, he stated that the Company had no intention of negotiating with the Union concerning a set of incentive rules or rates for the strippers in the zinc plant . He said that management would examine the material which the r For the purpose of this proceeding, it is unnecessary to set forth or consider the Company's incentive rules or the Union's counterproposals on the merits THE BUNKER HILL CO. Union had submitted but would promulgate whatever rules the Company deemed appropriate. Finally, Lennon an- nounced that there would be no counterproposals and no further meetings with the Union. Mooney referred to the Union's letter, and told Lennon that if the Company disagreed with the Union's proposals, it behooved it to submit counterproposals. Lennon retorted that there would be no counterproposals from management. Mooney commented that this attitude would not be productive in establishing an incentive program in the zinc plant cell room. Mooney remonstrated that the strippers would not work on an incentive basis until some definite understand- ing was reached regarding the rules and incentive rates of pay, a position which the Union has steadfastly maintained since. Lennon noted that there had not been an incentive program in the plant for some time, that the Company intended to establish such a program, and that it would promulgate and post the program. The meeting ended on that note, with Mooney still protesting that the Union remained prepared to make a serious effort to reach agreement on incentive rules so that a program could be installed in the zinc plant, which would be in the best interests of both the Company and the Union. So far as the record reveals, Lennon made no reference at this meeting either to the management rights (art. III) or waiver provisions (art. XXV) of the labor contract. On August 31, at about 2:30 p.m., shortly before the end of the workday, some 25 strippers were in the lunchroom adjacent to the cell room, where they found Lennon and Bird. Bird told the men that management had another proposal which he wanted to read to them, and distributed copies to each of the men. Bird then read the proposals verbatim. When he had finished reading, he asked whether there were any questions, and several of the men queried him. The same day or the following day, copies of the Company's new proposals appeared on the bulletin board in the lunchroom and at the "shifter's" office. The new incentive rules, dated August 31, introduced by the same preamble contained in the earlier incentive rules, dated August 23, were accompanied by the following memoran- dum: MEMORANDUM 31 August 1972 To: Electrolytic Department Cathode Strippers Subject: Incentive Stripping Program On May 30, 1972, we agreed to sit down with the Union, when mutually convenient, to review and seriously consider proposed changes in the Incentive Rules for Stripping. Due to many problems, including some within the Union, this meeting could not be arranged until recently. 8 Whitley, called as a witness by the General Counsel, testified that this action was taken in response to complaints by the strippers that they were being required to work for unduly long periods in an atmosphere in which noxious fumes were being emitted. They had previously been permitted to leave their work area to go to the adjoining lunchroom after completion of each 8-load work cycle during the normal 8-hour workday. It is evident that this action was taken unilaterally and, despite the fact that it may have been 31 We- have now met with the Union, on Tuesday, August 29, 1972, and critically reviewed their proposed changes to the Rules. Since the meeting with the Union we have met with management people involved with the program and this group has given the Union's proposals the serious consideration we promised. The attached set of Incentive Stripping Rules reflects those changes and modifications to the previous rules suggested by the Union that we have deemed practica- ble. We appreciate having received these suggestions and we now offer this new Incentive Stripping Program that we are convinced will provide the optimum benefit to the strippers and the Company. There are no further meetings scheduled with the Union on this program. We hope that the Program will be accepted by enough Strippers to make the Incentive Program a continuing feature of the Electrolytic Department. However, if it is not accepted by a sufficient number of strippers to make it worthwhile, by Monday, Septem- ber 11, 1972, it will be withdrawn and stripping will be done on a day's pay basis. /s/ Robert L. Bird Robert L. Bird, Manager Zinc Plant No further meetings were held between Respondent and the Union thereafter and, on September 11, 1972, the following notice was posted over the signature of Ed Whitley, department superintendent: September 11, 1972 NOTICE To: Electrolytic Department Cathode Strippers For a 30-day trial period, strippers will be allowed to leave the Department up to one hour early, provided all the loads have been pulled and stripped, and all strippers' assignments have been completed to the foreman's satisfaction. Work assignments include clean-up, straightening plates, and associated duties. New men will be included in the above trial after a 3-shift break in period and their work load must be completed before any employee is eligible to leave early .8 On the same day, September 11, 1972, Respondent withdrew the incentive plan promulgated on August 31, 1972, without further notice to or consultation or negotia- tion with the Union. Contentions and Conclusions Respondent concedes that it did, in fact, unilaterally promulgate incentive rules for stripping, and thereafter beneficial to the employees, constituted a change in the terms and conditions of their employment, a mandatory subject of collective bargaining Inasmuch as this action has not been alleged to constitute unilateral action in violation of Sec 8(a)(5), no finding is required as to whether it was permissible under the management rights provision or whether it was tantamount to a refusal to bargain 32 DECISIONS OF NATIONAL LABOR RELATIONS BOARD unilaterally withdrew the incentive plan, and further admits that it "absolutely and unequivocally"9 refused to bargain about incentive rules with the Union. In its brief, Respondent posits the issues as follows: 1. Whether the labor management agreement be- tween The Bunker Hill Company and the Union permits the Company to act as it did, the Union having expressly waived its right to request bargaining under Section 8(d) of the Act. 2. Whether the arbitration and grievance procedure provided for in the labor management agreement is the exclusive remedy for the Union under the facts and circumstances of this case and requires the Board not to assert jurisdiction under the Act. 3. Whether the issues raised by the complaint filed by the Regional Director are moot in view of the fact that on the one hand it is contended the Company wrongfully unilaterally promulgated the incentive plan and on the other hand wrongfully unilaterally withdrew the incentive plan. Relying on the management rights and waiver provisions of the collective-bargaining agreement, Respondent main- tains that it was justified in unilaterally promulgating, as well as subsequently withdrawing, the incentive plan. Article III, Management Rights, of the collective-bar- gaining agreement between The Bunker Hill Company, A Subsidiary of Gulf Resources and Chemical Corporation, and Northwest Metal Workers Union, Independent, the Union's predecessor, effective from November 6, 1972, to November 5, 1973, provides: It is recognized that the management of operations, methods and means of production and the full direction and size of the working force, and the contracting out of work is the function and responsibil- ity of the Company. The entire conduct of its functions and responsibili- ties is solely within the judgment of the Company except as it may be otherwise expressly modified by this Agreement. Respondent further relies upon the waiver or "zipper" clause, contained in article XXV, Effective Date and Term of Agreement, which contains the following language: The parties hereto specifically waive their rights to request bargaining under Section 8(d) of the Labor- Management Relations Act of 1947 as amended with respect to unwritten terms dealing with wages, hours and other terms and conditions of employment for the life of this Agreement. Respondent does not contend that the incentive rules constituted a nonmandatory or voluntary subject of collective bargaining. Nor does Respondent contend that the subject of incentive rules are not encompassed within the provisions of Section 8(d) of the Act. Since the statutory term "wages" encompassess "emoluments result- ing from employment in addition to or supplemental to actual `rates of pay,' " and are in the nature of "direct and immediate economic benefits flowing from the employ- ment relationship," (W. W. Cross & Co., Inc. v. N.L.R.B., 174 F.2d, 875, 878 (C.A. 1, 1949), it is clear that incentive programs designed to increase or supplement the actual earnings of employees are within the contemplation of the term "wages" as used in the Act .1o It is, therefore, found that the incentive rules for stripping clearly constituted a mandatory subject of collective bargaining. The issue, however, is whether Respondent was justified in taking unilateral action with regard to the plan by reason of the management rights (art. III ), and express waiver provisions (art. XXV) quoted above.il The management rights article here is not essentially different from the provision considered in Proctor Manu- facturing Corporation,12 where the Board held that the clause did not permit the employer to establish work production quotas and piecework wage rates unilaterally and that the "rule, applicable to negotiations during the contract term with respect to a subject which has been 9 Resp. br, p. 4, 11, 2 and 3. 10 C & S Industries, Inc, 158 NLRB 454, involved the unilateral institution of a incentive wage system without prior negotiations and written consent of the union as provided in the contract The Board noted that, "[a llthough the contract makes no specific mention of wage incentives, such incentives are inseparably bound up with and are thus plainly an aspect of the payment of wages, a subject expressly covered by the contract." (Citing John W Bolton & Sons, Inc., 91 NLRB 989, The Ingalls Shipbuilding Corporation, 143 NLRB 712, 158 NLRB 454, 459; see also N L R.B v C & C Plywood Corporation, 385 U S. 421 (1967). Any doubt that the "superimposition of an incentive wage plan upon the contractually established wage structure operated as a `modification' of contract terms, within the meaning of Section 8(d)," (C & S Industries, Inc, supra at 459) in this case is dispelled by the preamble to each of the proposed incentive rules, dated August 23 and 31, 1972, respectively, reciting that, "The purpose of this program is to achieve a stable employment base by providing the employee with an opportunity to increase his earnings by performing work over and above an established base " (Emphasis supplied) Moreover, the sentence which follows, "Performance of incentive work also earns a reduction in the attendance time on the job below the normal eight hour shift " clearly denotes a modification in the normal hours of work, a mandatory subject of collective bargaining 11 Although not specifically referred to at the hearing, Respondent also relies, in its brief, on other language in the collective -bargaining agreement precluding modification, except in writing The article in question is- ARTICLE XXI Agreement May Not Be Amended Except By Written Document A. The parties realize that not infrequently, after agreements similar in part to this Agreement have been executed, one party thereto will contend that the other party has at some time during negotiations for or during the term of the Agreement, orally agree to amend, modify, change, alter or waive one or more provisions of the Agreement , or that by the action or inaction of such party, the Agreement has been amended, modified, changed or altered in some respect With this realization in mind and in order to prevent such contention being made by either party hereto, insofar as this Agreement is concerned, the parties have agreed to and do hereby agree that no provision or term of this Agreement may be amended, modified, changed, altered or waived except by written document executed by the parties hereto 12 131 NLRB 1166, 1168 The management rights provision there read' The parties recognize that the right of management to direct and control the business and affairs of the Employer, and its right to control, supervise and administer the plant of the Employer, are functions belonging exclusively to the Employer, and nothing in this agreement will be interpreted in such a manner as to deprive the Employer of said management rights unless said interpretation is expressly required by the provisions of this agreement THE BUNKER HILL CO. 33 discussed in precontract negotiations but which has not been specifically covered in the resulting contract, is that the employer violates Section 8(a)(5) if, during the contract term, he refuses to bargain or takes unilateral action with respect to the particular subject, unless it can be said from an evaluation of the prior negotiations that the matter was `fully discussed' or `consciously explored' and that the Union `consciously yielded' or clearly and unmistakably waived its interest in the matter." It should be noted that in the instant case, there is no actual evidence of any "prior negotiations" concerning incentive wage plans. There is some intimation in the record that an incentive wage plan may have existed at the plant at some time in the past, but there is no affirmative evidence that Respondent and the Union, or its predeces- sor, had "fully discussed" or "consciously explored" the subject matter.13 In any event, Respondent is not relying on an implied waiver, resulting from the conduct of the Union's predeces- sor during negotiations culminating in the collective- bargaining agreement, but on the express contract lan- guage with regard to waiver. This clause provides: The parties hereto specifically waive their rights to request bargaining under Section 8(d) of the Labor- Management Relations Act of 1947 as amended with respect to unwritten terms dealing with wages, hours and other terms and conditions of employment for the life of this Agreement. [Emphasis supplied.] The incentive wage plan here, which is not expressly mentioned in the contract, would, of course, be embraced in the phrase "unwritten terms." As the Board said, however, in C & S Industries, Inc., "Although the contract makes no specific mention of wage incentives, such incentives are inseparably bound up with and are thus plainly an aspect of the payment of wages, a subject expressly covered by the contract." 14 It is, of course, well settled that a bargaining representa- tive may waive statutory rights guaranteed employees, provided such waiver does not contravene the policies of the Act. In this regard, however, the Board has held, in Tide Water Associated Oil Company, 85 NLRB 1096, 1098, "We are reluctant to deprive employees of any of the rights guaranteed them by the Act in the absence of a clear and unmistakable showing of a waiver of such rights. [Footnote omitted.] We cannot, therefore, predicate a specific waiver 13 The following colloquy occurred at the hearing JUDGE RoGosiN: .. in the interest of my following the issue[s ], is this [the August 23, 1972, Incentive Rules ] the first time an incentive plan was ever inaugurated at the plant, Mr Boyd, or is this merely a change in the existing incentive plan MR. Born. Frankly, Your Honor, it isn't the first time, but we maintain that is the first time that can be talked about at this hearing In the colloquy which followed, counsel for the General Counsel stated that he was not "taking a position as to whether any changes in incentive rules prior to August 22 would [constitute] a refusal to bargain if there were actually unilateral changes because, in fact, no union had been certified prior to that date and there was a hiatus period [sic ] during the summer of 1972 before the amendment certification issued on August 22nd. Thereafter on August 23rd is the first change with respect to incentive rules after the amendment for certification was issued" The matter was not further pursued at the hearing so there is no basis for inferring that an incentive of the right to bargain collectively concerning pension plans upon the . . . agreement, particularly in view of the vagueness of the `Management Functions' clause and the ommission from the contract of any of the terms and conditions of the Retirement Allowance Plan." 15 As to any contention that Section 8(d) of the Act does not require Respondent to discuss any modification of the existing agreement during its term, the Board, adopting the language of the Trial Examiner, indicated that the pertinent language of the section refers to terms and conditions which have been integrated and embodied into a writing. Conversely it does not have reference to matters relating to "wages, hours and other terms and conditions of employment," which have not been reduced to writing. As to the written terms of the contract either party may refuse to bargain further about them, under the limitations set forth in the paragraph, without committing an unfair labor prac- tice. With respect to unwritten terms dealing with "wages, hours and other conditions of employment," the obligation remains on both parties to bargain continuously.16 A waiver of statutory rights will not be inferred from the mere absence from the contract of specific reference to a subject protected by the Act, or because the contract contains a general management prerogatives clause, or because the union failed during contract negotiations to obtain contract protection of its statutory rights.17 Nor can the statutory protection be forfeited, except by express waiver, since a provision protecting the right "would normally be implied in an agreement by operation of the Act itself." 18 It is, therefore, found that neither the management rights clause nor the "zipper" or "wrap-up" provision of the contract authorized or permitted Respondent to institute the incentive rules for stripping, announced on August 23 and 31, 1972, without prior notice to or consultation or negotiation with the Union. To the extent that it may be material, it is found that the evidence fails to establish that incentive wage rules, a subject not specifically covered in the resulting contract, was discussed between Respondent and the Union's predecessor during precontract negotia- tions, or with the Union after it acquired exclusive representative status at any time prior to the posting of the first incentive rules for stripping. wage program was "fully discussed" or "consciously explored," or that the Union "consciously yielded" or clearly and unmistakably waived its interest in the matter. i4 158 NLRB 454, and cases cited 15 Tide Water Associated Oil Company, 85 NLRB 1096, 1098 16 Supra at 1099-00 17 See, e.g, Timken Roller Bearing Co v N L R B., 325 F 2d 746, 751 (C.A. 6, 1963), enfg 138 NLRB 15, cert denied 376 U.S 971 (1964); N L R B v. The Jacobs Manufacturing Company, 196 F 2d 680, (C.A 2, 1952), enfg 94 NLRB 1214; N L R B v. J. H. Allison & Company, 165 F.2d 766, 768 (C.A. 6, 1948), cert denied 335 U S 814 (1948), enfg. 70 NLRB 377, New York Mirror, 151 NLRB 834, 839-841, Proctor Manufacturing Company, 131 NLRB 1166 See also The Beacon Journal Publishing Company, 164 NLRB 734; Unit Drop Forge Division Eaton Yale & Towne, Inc, 171 NLRB 600. is See N L R B v Perkins Machine Company, 326 F 2d 488, 489 (C A. 1, 1964), Cloverleaf Division of Adams Dairy Co, 147 NLRB 1410, 1413-14. 34 DECISIONS OF NATIONAL LABOR RELATIONS BOARD Respondent further contends that neither the memoran- dum of understanding, dated May 30, 1972, in which Respondent "agreed to sit-down" with the Union, and "to review and seriously consider any proposed changes and/or modifications of ...-Work Rules and Incentive Rules for Stripping," nor its meeting with the Union on August 29 amounted to a recognition of any duty to bargain with the Union concerning the incentive program. It has been noted that Lennon, Respondent's director of industrial relations, failed to rely on either the management rights or waiver provisions of the contract during this meeting. Respondent's position that, by consenting to "review and seriously consider" the Union's counterpropo- sals it was not conceding that the subject of the incentive rules was negotiable, is immaterial on the issue of its statutory duty to bargain. If anything, once the duty to bargain on the subject has been established, any reserva- tions by Respondent, expressed or otherwise, would amount to evidence of recalcitrance to bargain about the issue. Nor need it be decided whether, by meeting with the Union and "listening" to its counterproposals, Respondent may be deemed to have acquiesced in the Union's position as to the bargainability of the incentive rules. It is abundantly clear, as was repeatedly asserted by Respon- dent, that it had no intention of negotiating a set of incentive rules with the Union. Although, as has been stated at the outset, the gravamen of the complaint is Respondent's unilateral action in promulgating incentive rules affecting "strippers," the General Counsel maintains that the allegations are sufficiently broad to state a case of refusal to bargain based on Respondent's failure, upon demand, to negotiate with the Union the substantive terms of the incentive rules. Assuming that the complaint sufficiently alleges a refusal to bargain on that ground,19 and that Respondent was placed on sufficient notice that the General Counsel would be seeking a remedial order requiring Respondent to bargain with the Union about the substantive terms of incentive rules, Section 8(d) of the Act would appear to preclude such result. To hold that Respondent is required to bargain regarding an incentive wage plan not contained in the contract, during its term, would amount to a 19 The only paragraphs of the complaint susceptible to this interpretation are: 10 On or about August 23 and August 25, 1972, the Union, through its agent and staff representative J P. Mooney, demanded that Respondent meet and bargain about changes in incentive rules 11. On or about August 29, 1972, the Union and Respondent held a meeting at which the Union presented counterproposals and changes in incentive rules. 12. During the meeting referred to above in paragraph 11, Respondent's Director of Industrial Relations, Art Lennon, stated that: a incentive rules were not subject to negotiations between Respondent and the Union; b Respondent would not submit any future counterpro- posals to the Union on incentive rules, and c no future meetings would be held with the Union to discuss incentive rules between the parties. The remaining allegations of the complaint relate to the unilateral change in the incentive rules. It is significant that the conclusionary allegations of the complaint refer only to pars. 9, 12, 13, and 14 as the basis for the violation of Sec. 8(a)(5), in two separate paragraphs (15 and 16). 20 Proctor Manufacturing Corporation, 131 NLRB 1166, 1170. 21 It is noted that the collective-bargaining agreement expires, by its "modification," which the Union could not demand, except under the conditions outlined in Section 8(d). This is not inconsistent with the finding, previously made, that incentive wage plans are encompassed within the term "wages," and that unilateral action to achieve such object, without prior notice to the Union and an opportunity to negotiate, constitutes a refusal to bargain. The situation here is distinguishable from that in the Proctor case, where the Board held Under Section 8(d) of the Act the method of computing the minimum wage and bonus could not be made the subject for renegotiation by either party during the term of the contract. These two items, however, do not exhaust or exclude other elements which go to make up wage determinations, and these necessarily remained open for negotiations 2° The Board there said that the contract "merely prescribed the method of computing the minimum wage and bonus, but without identifying or enumerating piecework rates." (Id. ) Here, the wage rates were established under the contract, but the Union was seeking to "superimpo[se] .. an incentive wage plan upon the contractually established wage structure," entailing a "modification of contract terms, within the meaning of Section 8(d)." (C & S Industries, Inc., 158 NLRB 454, 459.)2i It is, therefore, found that Respondent has not, since August 23, refused to bargain with the Union, by failing and refusing to negotiate the substantive terms of incentive rules, in violation of Section 8(a)(5) of the Act. As to its defense that the issue of the incentive rules should have been resolved by the grievance and arbitration procedure provided for in the contract, it should be noted that Respondent does not contend that the matter should now be deferred to arbitration. On the contrary, despite an inconclusive exchange of communications, prior to the issuance of the complaint, between counsel for the General Counsel and counsel for Respondent, seeking to ascertain its position with regard to deferral to arbitration, under guidelines established by the General Counsel, Respondent declined to take a position.22 Despite his unwillingness to take a position on this issue terms, on November 5, 1973, and that this matter may not be decided by the Board before the expiration date Since it has been found that the incentive rules constitute a mandatory subject of collective bargaining, the parties may be better advised to have recourse to the requirements of Sec. 8(d) to achieve modification of the contract with regard to an incentive wage plan 22 On March 16, 1973, counsel for the General Counsel wrote to counsel for Respondent, in relevant part, "Our agency will issue a complaint in this matter on March 21, 1973, unless you indicate to me in writing before that date that you are willing to arbitrate the incentive rules dispute underlying the charge and that you are willing to waive any contractual time limitations on the filing and processing of grievances to arbitration ." In his response, Respondent's counsel, while qualifying the statements attributed to him by the General Counsel regarding the Company's unwillingness to submit the dispute to arbitration, stating that he had only discussed recommendations he had made to his client, continued "Contrary to the implication contained in your letter, it has been our feeling from the start that the issue you refer to between the company and the union would probably be a matter for arbitration if a grievance was processed properly under the contract" He further stated that he had not told counsel that the Company would not "waive the contractual time limitation set forth in the contract in issue," but had merely said that that would be his recommendation , and that he did not have authority to agree or refuse to do so. THE BUNKER HILL CO. at the hearing, Respondent's counsel asserted that Respon- dent was standing on the position that, while the dispute was a matter for the grievance and arbitration procedure, by failing to file a timely grievance, the Union was precluded from pursuing the matter to arbitration and that, since this was the exclusive remedy which had been available to the Union, the Board should dismiss these proceedings. It should be noted that Respondent contends that under the language of the grievance procedure, it does not itself have recourse to this procedure, and that only the Union may initiate grievance proceedings.23 In any event, the record leaves no doubt that Respon- dent has been unwilling either to waive the contractual time limitation for the filing of a grievance or, for that matter, to proceed to arbitration. Instead, it contends that, having failed to resort to the grievance and arbitration machinery, the Union has forfeited its exclusive remedy for relief and that this proceeding should not be deferred to arbitration, but should be dismissed. Under these circum- stances, the issue of deferral to arbitration is not involved. Since Section 10(a) of the Act expressly provides that the power of the Board to prevent unfair labor practices enumerated in Section 8, "shall not be affected by any other means of adjustment or prevention that has been or may be established by agreement, law, or otherwise .. . and, in the absence of any basis for deferral to arbitration, this defense is rejected as without merit. Respondent's defense, that it "was not afforded a hearing within five (5) [as amended at the hearing] days from the date of the complaint," as required by the Board's Rules and Regulations (actually Sec. 10.(b)) is based on an erroneous interpretation of the section. This provides, in pertinent part, that the notice of hearing shall be issued "not less than five days after the serving of said complaint." According to the affidavit of service, the complaint and notice of hearing were served on March 23, 1973, and the hearing held on June 26, 1973. It can hardly be contended, as Respondent appears to do, that the Act requires that a hearing be held within 5 days from the date of the complaint. This contention is wholly without merit. Finally, Respondent contends that, even if it be held to have violated the Act, by unilaterally promulgating the incentive rules, its rescission, on September 11, 1972, of the plan, posted on August 31, 1972, "cured" any wrongful conduct in which it might have engaged. Although this argument may appear to have superficial appeal, it obviously stems from the contention that if Respondent had the right to institute the incentive rules unilaterally, it had a concomitant right to withdraw the plan unilaterally. It is well settled that the abandonment of unfair labor practices, particularly where there is no assurance that the unfair labor practices will not be repeated, does not render the issue moot. Whether, under the circumstances, Respon- 23 The grievance procedure does not specifically provide that the Employer may initiate proceedings, and Respondent contends that the provisions had been so construed by the parties Art XVI, Grievance Procedure, states at the outset, "An employee who believes his rights under this Agreement have been adversely affected by the action of the Company will be required to follow the procedure set forth in this Article for the presentation, investigation and determination of a grievance " There follows 35 dent was required to notify and negotiate with the Union before rescinding the incentive rules need not be decided. It is, therefore, found, on the basis of the foregoing and upon the entire record, that by unilaterally, and without prior notice to or negotiation with the Union, promulgat- ing the incentive rules on August 23 and 31, 1972, Respondent has failed and refused to bargain collectively with the Union, in violation of Section 8(a)(5), thereby interfering with, restraining, and coercing employees in the exercise of rights guaranteed in Section 7, in violation of Section 8(a)(1) of the Act. IV. THE EFFECT OF THE UNFAIR LABOR PRACTICES UPON COMMERCE The activities of Respondent, set forth in section III, above occurring in connection with the operations of Respondent, described in section I, above, have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States, and tend to lead to labor disputes, burdening and obstructing commerce and the free flow of commerce. V. THE REMEDY Having found that Respondent has engaged in unfair labor practices within the meaning of Section 8(a)(5) and (1) of the Act, it will be recommended that it cease and desist therefrom and take certain affirmative action designed to effectuate the policies of the Act. It has been found that Respondent unilaterally, and without prior notice to or negotiation with the Union, promulgating the incentive rules described above. It will, therefore, be recommended that Respondent cease and desist from the unfair labor practices in which it has been found to have engaged. Upon the basis of the above findings of fact, and upon the entire record in the case, I make the following: CONCLUSIONS OF LAW I. The Bunker Hill Company, Respondent herein, is now, and at all times material herein has been, an employer engaged in commerce and in operations affecting commerce within the meaning of Section 2(2), (6), and (7) of the Act. 2. Local Union 7854, United Steelworkers of America, AFL-CIO, the Union herein, is, and at all times material herein has been, a labor organization within the meaning of Section 2(5) of the Act. 3. All production and maintenance employees em- ployed by the Bunker Hill Company at its operation in and around Kellogg, Idaho, excluding any craft units hereto- fore certified by the National Labor Relations Board (such as electricians, carpenters, bricklayers, boilermakers and blacksmiths, plumbers, pipefitters, steam fitters and lead a three-step grievance procedure, culminating in arbitration (art XVII) The grievance procedure appears to apply exclusively to disciplinary action alleged to have been taken against employees, and does not appear to deal with matters of contract interpretation Apart from any question of mutuality of remedy, it is undisputed that Respondent at no time sought to invoke the grievance and arbitration procedure in an effort to resolve the dispute regarding the incentive rules 36 DECISIONS OF NATIONAL LABOR RELATIONS BOARD burners, and machinists), all supervisory, technical and clerical employees, gatemen, office clerical employees, guards and watchmen as certified by the National Labor Relations Board on August 12, 1970, Case 19-RC-5370,24 constitute a unit appropriate for the purposes of collective bargaining within the meaning of Section 9(b) of the Act. 4. Local Union 7854, United Steelworkers of America, AFL-CIO, the Union herein, was, on August 22, 1972, and at all times thereafter has been, the exclusive representative of all employees in the appropriate unit, described above, including "strippers," for the purposes of collective bargaining within the meaning of Section 9(a) of the Act. 5. By unilaterally, and without prior notice to or consultation with the Union, promulgating incentive rules for stripping on August 23 and 31, 1972, Respondent has engaged in, and is engaging in, unfair labor practices within the meaning of Section 8(a)(5), thereby interfering with, restraining, and coercing its employees in the exercise of rights guaranteed in Section 7 of the Act within the meaning of Section (a)(1) of the Act. 6. The aforesaid unfair labor practices are unfair labor practices affecting commerce within the meaning of Section 2(6) and (7) of the Act. Upon the basis of the foregoing findings of fact and conclusions of law, and upon the entire record, and pursuant to Section 10(c) of the Act, I make the following recommended: ORDER 25 The Respondent, The Bunker Hill Company, Kellogg, Idaho, its officers, agents, successors, and assigns, shall: 1. Cease and desist from: (a) Unilaterally, and without prior notice to or consulta- tion with the Union, promulgating or instituting any incentive wage rules, or making any changes in wages, 24 The description of the appropriate unit is based on the recognition clause of the collective-bargaining agreement between Respondent and the predecessor Union, presently, in effect. 25 In the event no exceptions are filed as provided by Sec. 102,46 of the Rules and Regulations of the National Labor Relations Board, the findings, conclusions, and recommended Order herein shall, as provided in Sec 102.48 of the Rules and Regulations, be adopted by the Board and become hours, or terms or conditions of employment of its employees in the appropriate unit described herein. (b) In any like or related manner, interfering with, restraining, or coercing its employees in the exercise of the right to self-organization, to form labor organizations, to join or assist Local Union 7854, United Steelworkers of America, AFL-CIO, or any other labor organization, to bargain collectively through representatives of their own choosing, and to engage in other protected concerted activities for the purpose of collective bargaining or other mutual aid or protection guaranteed in Section 7 of the Act, or to refrain from any or all such activities, except to the extent that such right may be affected by an agreement requiring membership in a labor organization- as a condition of employment, authorized in Section 8(a)(3) of the Act, as amended. 2. Take the following affirmative action which, it is found, will effectuate the policies of the Act: (a) Upon request of Local Union 7854, United Steel- workers of America, AFL-CIO, formally rescind the "Incentive Rules for Stripping," dated August 23 and August 31,' 1972, which Respondent promulgated unilater- ally. (b) Post at its plant at Kellogg, Idaho, copies of the attached notice marked "Appendix. " 26 Copies of said notice, on forms provided by the Regional Director for Region 19, after being signed by Respondent's duly authorized representative, shall be posted by Respondent immediately upon receipt thereof, and maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted . Reasonable steps shall be taken by Respondent to ensure that said notices are not altered, defaced, or covered by any other material. (c) Notify the Regional Director for Region 19, in writing, within 20 days from the date (of this) Order, what steps Respondent has taken to comply herewith. its findings, conclusions , and Order, and all objections thereto shall be deemed waived for all purposes 26 In the event the Board's Order is enforced by a Judgment of the United States Court of Appeals , the words in the notice reading "Posted by Order of the National Labor Relations Board" shall read "Posted Pursuant to a Judgment of the United States Court of Appeals Enforcing an Order of the National Labor Relations Board."